Both Lapid and Netanyahu insist on the education portfolio, with its massive NIS 40 billion ($10.8 billion) budget and ties to ultra-Orthodox schools • Lapid marks victory as cabinet reduced from 27 ministers to only 20, with eight deputy ministers.

Mati Tuchfeld

Yesh Atid Chairman Yair Lapid insists on both the education and interior portfolios.

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Photo credit: Gideon Markovic

Following an intense and prolonged negotiating session between the key party leaders — Prime Minister Benjamin Netanyahu (Likud), Yisrael Beytenu's Avigdor Lieberman, Yesh Atid's Yair Lapid and Habayit Hayehudi's Naftali Bennett — it appears that a coalition deal has finally been agreed and is likely to be signed as early as Wednesday.

Though most of the disputed issues have been ironed out and agreements have already been formulated, the main point of contention now centers on Netanyahu's and Lapid's refusals to relinquish the education portfolio. Netanyahu wants to keep the portfolio for Likud's current minister Gideon Sa'ar, while Lapid insists on his party member, Shai Piron, obtaining the post.

The post is important for several reasons: First, the Education Ministry has an annual budget of NIS 40 billion ($10.8 billion), 10 percent of the total state budget and second in size only to the defense budget. Second, since Netanyahu has scuttled his long-time partnership with the ultra-Orthodox parties in favor of a coalition with Yesh Atid and Habayit Hayehudi, the Education Ministry is possibly the last place that a Likud minister can ensure that funds for haredi religious schools continue to flow. An education minister from Yesh Atid could redraw the funding priorities at the ministry, which would further push the haredi parties away from Likud.

"There is no reason to remove a successful minister from his position," Likud stalwart Tzahi Hanegbi said Tuesday.

Netanyahu has made it clear to Lapid that he does not plan to hand over the education portfolio.

"The Education Ministry under the authority of Education Minister Gideon Sa'ar has many significant achievements to show for his four years in office, and the prime minister would like to preserve the success of Israel's students, as reflected in the recent international tests," a Likud source said Monday.

Both Teachers' Association Chairman Ran Erez and Association of Local Authorities Chairman Shlomo Buhbut, who is close to the Likud party, support keeping Sa'ar in the post of education minister.

"Continuity in the post is critical for the education system," Erez said.

Likud-Beytenu is willing to hand the Interior Ministry (currently held by Shas, which will not be in the coalition) to Yesh Atid, but Lapid is insisting on both the interior and education portfolios. Likud officials have criticized Lapid's demand as "exaggerated." If Lapid ends up winning the battle over the education portfolio, Sa’ar will be appointed interior minister.

However, the argument over the number of cabinet ministers in the next government, has been resolved. Lapid initially demanded that the number be reduced from the existing 27 to 18, but in a compromise, the sides have agreed that the next cabinet will comprise 20 ministers and eight deputy ministers.

After the marathon negotiations between the leaders of the four largest coalition parties on Sunday, which lasted well into the night, their negotiating teams continued to work hard on drafting and honing the coalition agreements. On Monday afternoon, the party leaders returned to the prime minister's bureau to resume negotiations, which, again lasted many hours.

During the renewed talks, Lapid reiterated his demand to reduce the number of ministers in the cabinet, and Netanyahu agreed on condition that the number of Likud ministers would not diminish, thus ensuring a majority for Likud-Yisrael Beytenu in the cabinet. With this condition, the next cabinet will have 11 ministers from the joint Likud-Beytenu faction (not including the prime minister), Yesh Atid will have five ministers and Habayit Hayehudi will have three. Kadima Chairman Shaul Mofaz, whose party won two Knesset seats in the election and who was initially supposed to be included as a minister under Yesh Atid's allotment, will apparently not be appointed minister after all.

But not everything is sailing smoothly. The compromise between Likud-Beytenu and Yesh Atid is causing problems between Likud-Beytenu and Hatnuah — the first party to sign a coalition deal with the ruling party. Under that deal, Hatnuah, led by Tzipi Livni, was supposed to receive two ministerial portfolios — the Justice Ministry for Livni and the Environmental Protection Ministry for Hatnuah No. 3 Amir Peretz. But now, under the deal to reduce the number of ministers, Hatnuah can only feasibly have one portfolio. Likud-Beytenu has indicated to Livni that she must give up the second portfolio but at this stage, both Livni and Peretz have strongly refused.

Meanwhile, Habayit Hayehudi has agreed to three ministerial portfolios. Bennett will still be appointed industry, trade and labor minister, but the public diplomacy position he was promised will now be transferred to the authority of the Prime Minister's Office. Habayit Hayehudi members Uri Ariel and Uri Orbach will receive the housing and Jerusalem and Diaspora portfolios, respectively. Eli Ben-Dahan, also of Habayit Hayehudi, will be appointed deputy minister of religious services, while the position of religious services minister will remain unfilled.

Habayit Hayehudi on Monday looked into the possibility of converting the Housing Ministry into a Settlement Affairs Ministry that will include jurisdictions currently distributed among several government ministries, but Likud has yet to respond to the inquiry.

Of the 11 Likud-Beytenu ministers, four will most likely be members of Yisrael Beytenu — Yitzhak Aharonovitch (public security) and Sofa Landver (immigration absorption) will remain in their current ministries, and Faina Kirshenbaum and Yair Shamir are expected to join them in the cabinet. Another possibility that Lieberman is currently considering is to keep Uzi Landau as a minister (currently minister of energy and water) and appoint Kirshenbaum as deputy agriculture minister, also leaving the position of agriculture minister unmanned.

Meanwhile, the reduction in ministerial portfolios may prove to be quite a challenge for Netanyahu within his own party, as many of his party members will most likely be very unhappy with what they end up getting after the portfolios are distributed.

With this in mind, Netanyahu may hold a secret faction-wide ballot to select the next Knesset speaker before the portfolios are assigned, to prevent vengeance votes against the prime minister's preferred candidate, Yuli Edelstein. Analysts surmise that the reason Netanyahu decided to endorse Edelstein for the post is because under his deal with Lapid, Likud will receive one less portfolio than the number of current acting ministers, meaning that one Likud minister will no longer be in the cabinet. If Edelstein is appointed Knesset speaker, it would free up his ministerial position.

The biggest winner in Likud will most likely be Moshe (Bogie) Ya'alon, whose appointment to the prestigious Defense Ministry is all but certain. Gilad Erdan has been offered the communications portfolio or the homefront defense portfolio, while Silvan Shalom has been offered the Negev and Galilee portfolio or the tourism portfolio. Yisrael Katz will remain transportation minister and outgoing finance minister. Yuval Steinitz will most likely be appointed minister of strategic affairs. Limor Livnat, who said Monday that she would agree to any appointment that Netanyahu decides for her, may remain in the Culture and Sport Ministry.

One thing is clear: Some ministers will not be happy with their new appointments, as will some MKs who expected to become ministers. Danny Danon, slated to become a deputy minister, said he would refuse the appointment and opt to be a simple MK or chair a Knesset committee. Danon, who is featured in the top five on the Likud Knesset list, believes that he will be appointed minister after all. Gila Gamliel also insisted that she would refuse the position of deputy minister, which she currently holds, and demand a ministerial position.